Ed Garcia - Posted by Nancy
Posted by Nancy on July 22, 2003 at 18:40:37:
Ed please help me with this financing problem. I will try to be brief:
I have a seller and a buyer (father - seller, buyer daughter). The seller needs all cash and the daughter does not qualify for a mortgage.
I stepped in and offered to purchase the house from father and lease option to daughter. Father will finance 10% and will also give his daughter $6,000 option consideration (which i will also use as proof of funds to the bank).
As the deal stands i will put no money down.
Now my broker is saying that closing costs will be 4% of the selling price. The selling price is $219,900 and this is the appraised rate (by a realtor). Daughter wants to split closing costs with me but i can’t come up with $4,000 (approx 50% of closing costs). i can only afford about $1,500. Broker recommended that I ask seller to increase selling price by closing costs - but how would this work if the selling price is already at market value?
Before you suggest that i use the option consideration, i need cash reserves in case these people default (not likely but not impossible either)
Thanks for your time
PS: this is my very first deal
Do you have any other ideas?